Not quite conceptualizing the benefit of the new goals

So I got my wish, and have the new goal options.  To try one out I went down my 80-some-odd categories and can't find one that would make sense to test-drive in.  I don't quite have a "one-click" budget, nor do I really care to, I'm fine with fooling around and tinkering about.

I mainly budget in these ways:
1. Scheduled transactions, big time.  Then try to top off a bit for fun/security.

2. Rounded off amount of funding for either monthly or semi-annual expenses.  $500 a month for gas/electric, $150 a month for auto and liability insurance, $900 for property taxes and insurance, etc.  Has kept me on track for a while.

3. Some categories, which are very necessary immediate/true expenses often were underfunded by me, so I started budgeting whatever the last average was and watching it grow.  No way to automatically cap it though, as far as I can tell.

4. No monthly funding, lump sum.  I have a category that holds the last 6 payments of my kids' school tuition payments, plus the $2k I'll need for a contract deposit for next year.  I also have a category with $25k for home improvements we plan to make whenever we get our acts together.  I expect that to dwindle over time until probably nothing's left and we start over.

5. Income smoothing.  Release an even amount (usually 1/6th) from certain lump income categories.

Ok, so how about categories I struggle with?  Car repairs.  I'm always trying to get that to at least $1k, ideally $2k.  I started saving $300 a month and then quickly changed it to $600 a month and my husband suddenly takes his car in for $732.10.  RWTP.  $600 a month again for Sept., and he needed new brakes last week for $619.  RWTP again.  Trying for $600 again in October...
I try to keep Vet at $1k, but often "borrow from it" then repay it the next month.  
Eating out.  It's $500 a month now, because try as a might, I still always end up overspending that $300-$400 I hope to spend.  

So like, making a monthly spending goal kind of makes me antsy, because if I decide I really really want those chicken wings at midnight, or those new shoes, and decide to re-prioritize from other discretionary categories, why do I need to be further warned of my "limit?"  If I'm saving for gifts all year (based on averages), and underspending each month, leaving me with a nice pot by December, which I probably won't spend all of because I know more gifts will come up throughout 2020, how would a spend by date benefit me?

So it's not that I feel like I'm struggling for help, just wondering if I'm missing some "Ah-ha moment" that others are benefiting from.

Also, the link to "Learn More About Goal Types" in the goals popup is broken, at least on my end (Chrome).

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  • Goals are not required. If they don't work for you, don't use them. I don't use them at all because they don't help me and I don't want extra visual clutter on my budget. If I'm saving up $5000 for something, I'll know I've reached the goal when there is $5K in the available column.

    Like 4
  • I've always liked them, and the basic ones have definitely helped me in the past, but maybe I'm just a little more advanced in my budgeting journey to use them as successfully.  A lot of my targets are reached, or I have my own convoluted ideas about how I want to fund stuff that would probably never be implemented in the app.  I live by scheduled transactions though!!  That's the majority of my quick budgeting, and thank goodness the "underfunded" option recently magically appeared.

    Like 1
  • Basically there are 2 new goals .

    One let's you spend without the goal nagging you about it. Classic use case is a vacation where you buy airfare several months ahead of the target date.

    (The old monthly funding goal would allow you to do this, but wouldn't adjust if you reallocated for some reason. This one does.)

    The second is trying to eliminate the sweeping of leftovers. Leftovers, say in Groceries, contribute toward the next month's desired total . The result is the leftover will be in TBB in the new month and budget values will be inconsistent.

    I prefer sweeping since that money reaches the new destination in the current month's area (one earlier than with the new goal), and there's something cathartic about seeing a string of $0 Available in those discretionary categories.

    This one is also weird in that it's tied to the passage of time in the real world. This is contrary to all other operations that consider the currently month displayed to be the "present".

    Like 2
      • Annieland
      • I was told there would be no math.
      • Annieland
      • 2 yrs ago
      • 1
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      dakinemaui Ok I think I get the vacation example.  It was like how I used to do Christmas gifts, and would set a budget for say, $2000 by Dec. and then start spending it in Oct. and have to keep raising the funding amount when the $2000 should have taken care of it.  I'll keep this in mind in case I start to find I'm budgeting a category like this again.  It's just not really typical, I guess.

      I've never been a sweeper.  It's funny you say cathartic... I get sick to my stomach when I look at the months that are left all grey $0.00's.  For me, it means I WAMmed everything I possibly could (usually because of unwise decisions or a VERY unforeseen true expense), or completely depleted what I saved up (like my ongoing car repairs challenge).  If I have money leftover in restaurants, it's like, "yay! extra chicken wings next month!!" or just less I have to budget in a category leaving extra TBB for other obligations.

      I did see how this goal "executes" at the month turnover.  Something I guess I'll notice if/when I use it.

      Like 1
      • dakinemaui
      • dakinemaui
      • 2 yrs ago
      • 2
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      Annieland said:
      For me, it means I WAMmed everything I possibly could

      Rule 3 goes both ways. Sometimes we guess/budget low (leading to overspending), but sometimes we guess high (leading to a surplus). Had I known I wouldn't need as much in Restaurants when I first allocated it, I would have put that money elsewhere to start with. (Assuming there's something more important than Restaurants that could benefit... I do like chicken wings, though, so maybe I would be sweeping INTO Restaurants!)

      Ultimately, the sweeping (and overspending correction) I do at the end of the month is my chance to put money where it should have been had I been better at predicting the future. Not seeing a string of gray $0s just confirms that I didn't predict very well. :-)

      Like 2
      • Granny Bogle
      • Still Workin'
      • Grannybogle
      • 2 yrs ago
      • Reported - view

      dakinemaui I'm a little lost when I read your explanation of sweeping and the comments below. I'm assuming that sweeping happens ON the first of each month, so I can't see what it looks like until the month rolls over.

      What was the "old" way of sweeping, and what is the new way?

      Which goals does sweeping affect?

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      • dakinemaui
      • dakinemaui
      • 2 yrs ago
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      Granny Bogle Sweeping is clearing out the remaining amounts in categories once you know you don't need that money. It is the standard way to avoid "lifestyle creep" when budgeting a fixed amount each month. (Typically with what is now called the "Save Monthly" goal.)

      After sweeping the category (to $0 balance in last month) and budgeting the nominal amount (in the current month), the current Available equals that nominal amount (the ultimate desire).

      The crucial part is it's incredibly obvious what's extra and can therefore be moved to whatever high priority category you wish to accelerate. While you might do this at the beginning of Oct., you operate in the Sept. budget area (because that's where the leftovers are).

      The new goal (Spend Monthly) also results in the same nominal amount being available in the current month. However, you leave the leftovers from last month in the category (no sweeping), and YNAB budgets correspondingly less in the current month. This results in a higher TBB, compared to sweeping, which can presumably be put toward whatever high-priority category. Note, however, that this happens in the month AFTER it was identified as extra.

      I also think it is less likely to actually be budgeted to that high priority when faced with an incomplete budget in the current (new) month.

      In other words, I believe the new workflow (Spend Monthly goal without sweeping) tends to give more money to less important things, which is exactly backwards. It's subtle and won't happen to everyone, but I believe newer users are especially prone to this.

      Like 2
      • Annieland
      • I was told there would be no math.
      • Annieland
      • 2 yrs ago
      • Reported - view

      dakinemaui jenmas Ohhhhhhhh OK.  Yeah, I'm full of lifestyle creep all up in here.  That must be why I can't wrap my head around a regular sweep routine.  It's something I do think about a lot and would love to start a discussion to gather thoughts on one day.  We're doing better now, I can afford more activities for my kids and want to budget more in that area, for instance.  And I also decided I'm tired of wearing the same Merrell clogs for the past 10 years and bought a bunch of prettier shoes.  I start to feel guilty when I hear people talk about the dangers of lifestyle creep.  But it's not like I'm digging a hole here.  Earning more and saving more, on track for retirement, kids' college VERY well funded, etc.  I think I'm pretty disciplined, just not in the way you guys are.  

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      • Granny Bogle
      • Still Workin'
      • Grannybogle
      • 2 yrs ago
      • Reported - view

      dakinemaui

      Well it looks to me from your explanation that YNAB is doing its own sweeping behind the scenes instead of letting me do it. I don't really get why YNAB makes us start fresh at the beginning of each month, anyway. Worse, now it sweeps or not, depending on the goal type. Please tell me if I'm wrong. 

      I wish YNAB would let me do my own sweeping--but I want to use goals...

      I dread the month's rollover in a couple of days. I just barely figured out the old system. This is making my head spin.

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      • dakinemaui
      • dakinemaui
      • 2 yrs ago
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      Granny Bogle I wouldn't say the new goal is sweeping behind the scenes, but I can see how one might consider it as such. It does wind up in TBB, but again, it's far less obvious how much is extra.

      And you're correct, most of the goals don't play nicely with Rule 3. Any reallocation you do (whether for overspending or underspending). I can't stand the nagging, so I don't use them.

      The Goal they really need to implement is one better suited as a template. Fill in the nominal budget value on-demand, but don't nag if you change it later. We'll see what comes out three years from now. 😄

      Like 3
      • Granny Bogle
      • Still Workin'
      • Grannybogle
      • 2 yrs ago
      • Reported - view

      Thanks, dakinemaui This is very interesting. I might try budgeting without goals at all. Might be a whole lot easier, more consistent with Rule 3, and as you say, less nagging.

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      • dakinemaui
      • dakinemaui
      • 2 yrs ago
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      Granny Bogle The old-school approach is to put your nominal values right in the category name for reference. If you split that across multiple checks, put the per-check amount there. Many will also put the due date there as well and order the categories by that date for further assistance.

      Like 1
  • For better or worse, this is perhaps one of the first instances I can recall that YNAB has listened to feedback requests. Newbies often want to do what is achieved by these goals.

    I personally think other approaches are better and these things are desired because newbies don't understand the subtleties of YNAB, but that's a debate for a different day.

    Like 2
      • Annieland
      • I was told there would be no math.
      • Annieland
      • 2 yrs ago
      • 1
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      dakinemaui I think when I was new to nYNAB and still not in much of a position of financial security, I really took to the new goals.  I loved the little auto budgeting for my next car insurance payment if I put in the expected amount and then resetting it for the next 6 months.  I guess it just happens to be that before they rolled out these new ones, I started reassessing my own financial situation and goals slowly over the past year.  And I changed some of my methods to adapt to new circumstances and expenses.  And wouldn't you know it, I just made the last payment on a 0% interest no xfer fee CC loan I took out last year, so I can't even play with the CC one.

      I still want to pick *something* to try the new features with, because I'm just like that.  But I agree, for us with maybe a bit more of a handle on things and a lonnnnng YNAB history, they just might not be a match.  I'm really glad it's there to help the new budgeters though!!

      Like 1
      • dakinemaui
      • dakinemaui
      • 2 yrs ago
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      Annieland I'd guess that switching over to the Spend By Date for a Christmas category may be your best bet.

      The "rollover" goal seems to be 6 to one and a half-dozen to another. A sweeper puts "leftovers" in categories at the end of the month into a high priority category. This new goal will promote leftovers in TBB after allocating at the beginning of the month that can go to the high priority category. Who knows, it may get new users to focus on the Available column more -- definitely an improvement.

      Like 2
      • nolesrule
      • Stealing From the Future fix is an improvement but is incomplete....
      • nolesrule
      • 2 yrs ago
      • 2
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      dakinemaui Now they just need to add a feature for the Spend By Date to set it as recurring and give you a timeframe. That would really turn it into an awesome Rule 2 management goal.

      I'm definitely a sweeper. I want to have the swept money available to use at the end of this month, not the beginning of next month. It's a subtle difference, but it is a difference. It's because I aggregate all my leftover funds with the money we didn't need at all in our budget that month and redistribute them based on a formula that Mrs. nolesrule and I came up with.

      Like 2
      • Annieland
      • I was told there would be no math.
      • Annieland
      • 2 yrs ago
      • Reported - view

      nolesrule I always find it really instructive to hear how the more experienced users approach their budgets. I just looked over all my categories again. I don’t think I could sweep a single thing ever. Maybe it’s because my expenses are more variable, whether I like it or not. Maybe I just spend too much. If I’m not allocating a set amount monthly, or letting funds rollover in underspent categories I’m setting myself up for certain disaster in probably less than 3 month’s time.  And if something is still looking underspent towards the end of the month, I’m most likely going to be using those funds for something else that invariably went over. 

      I’m looking at the iPad app right now and the wording stinks. The new monthly goal doesn’t say “I want to spend this month” but “I want to fund this month.”  I guess it’s the difference between the activity column and the available column, but it’s confusing at first glance which friggin goal I’ve set. 

      I’m actually underspent in restaurants right now, so I set my $500 goal there just to see what it does at month turnover.  

      Like
      • jenmas
      • jenmas
      • 2 yrs ago
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      Annieland Here are the categories that I sweep every month: Groceries, Eating Out, Entertainment, Fuel, Utilities/Gas, Utilities/Electric, Cable, Mobile Phone, Admin. I budget the exact same amount to these categories every month.

      Now for things like Cable and Mobile phone, we're talking less than a dollar because the bill varies month to month based on the # of days in the cycle.

      The two utilities I have a cap on how much I allow to accumulate. So if the cap is X, and I budget Y every month, anything left that is more than X-Y gets swept. Same on Entertainment and Admin.

      Groceries, Eating Out, and Fuel get swept down to zero at the end of every month. Actually, Groceries and Eating Out get partially swept every 10 days unless I know I have plans later in the month.

      Like @nolesrule everything that is swept goes into a formula and extra is added to my monthly taxable investing, charitable, and a few other categories. I budget one month at a time based on my two paychecks and there is usually some left over there as well that goes into the sweep redistribution. This process helps me ensure that I consistently live below my means.

      Like 2
      • Annieland
      • I was told there would be no math.
      • Annieland
      • 2 yrs ago
      • Reported - view

      jenmas That's really cool. I don't think I could hack it, though.  Maybe I live less below my means than I think I do?  One category I'm really stingy in is Entertainment.  I take stuff out of the library, we rarely go to the movies unless a kid begs and then I usually stay home to save.  So I've always tried to keep about $100 in that category, and top it off if necessary.  But then lo and behold, some amazing event or concert comes to town and I go crazy and spend $1200 on tix for the fam.  For reasons like this I'm trying to build up the Entertainment category so that when something big comes along I don't have to say no :(.  My husband and I finally went to the movies this weekend, and in Oct, I'll have about $588 in the category.  Would love to finally see Trans-Siberian Orchestra in concert this Christmas :) :).

      When money was tighter I'd budget each individual month for utilities based on what I expected (miss the old "spent last year" popup in YNAB4!!).  Now I've smoothed it to same amount every month so when that $700 month hits, I'm ready (don't ask, I know, it's bad).  I guess in a way I do sweep, in the sense that I keep a recurring transaction for cable, and when I see the next bill post I just update the amount in the future transaction.  Then I adjust "budget for upcoming" and dump (or steal) that buck from wherever else.  That's KINDA sweeping, right?? :).

      Like
  • Ok I think this is dumb. Here’s my home repairs category. This is August. I set it for 25k spending thru next year. Does this dialog make sense to you??  I want to SAVE? My available is now obviously under $25k, but I’m on track, which technically is true.  I think there is a lot of messy text with these goals which they will no doubt update a dozen more times I’m sure.

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  • Annieland said:
    I can afford more activities for my kids and want to budget more in that area, for instance.

    This is one reason I normalized this category to work with a consistent amount (budget the average as long as there's no overspending). The category accumulates in the slow months but dwindles in the high. It's just easier to acknowledge that's important to us and decrease/eliminate something else on a consistent basis. 

    The less I have to (get to?) think the better -- otherwise, I might talk myself into chicken wings weekly! Some might call it "disciplined", but I merely think of it as, "staying out of my own way".

    Like 1
  • I'm trying to grasp this as well. I thought I could use the "Monthly Contribution goal" for expenses like Restaurants and Entertainment, that vary each month. If on average i spend 1200 dollars a year on entertainment, I'd like to save 100.00/month so I will have enough over the course of the year for tickets, etc. that come up. But how do I ensure I don't overspend that category on any given month? Usually, if I go over in a discretionary category on a certain month, I'll just replenish it from another category. I am trying to have a buffer for each category, but I'm not sure if this is the correct goal for this. Any help would be appreciated!

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    • Coral Sloth You avoid overspending by checking the account balance before spending. If the balance is insufficient, either move funds from elsewhere (either another category or after you've received more money) or skip that purchase.

      You may need a dedicated category for tickets to protect $X from other Entertainment purchases. Protecting money from accidental use is the entire point of YNAB.

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    • dakinemaui  yes, thanks, I understand that, that’s how I’ve been using it. I was just trying to utilize the new goals to see if that was easier, but I think I’ll continue budgeting the way I have been with YNAB for the past several years. 

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  • dakinemaui said:
    You avoid overspending by checking the account balance before spending.

     Uh oh, I think you meant category  balance.  😜

    Like 2
      • dakinemaui
      • dakinemaui
      • 2 yrs ago
      • 1
      • Reported - view

      Annieland Absolutely correct -- great catch! 

      Like 1
  • Ok, here I go again.  Because I just can't leave well enough alone, I chose some categories to mess with.  I chose a couple where I've budgeted a flat amount each month (and we know I don't sweep) and because I started spending less, the category has perhaps grown too large.  So I went back to January and set a yearly goal.  Then I adjusted each month to the new goal amount to see if at any point I ended red.  There was a couple of times, but it was only a few bucks so I covered it (I think this is an implicit red arrow but I ain't going there :)), and continued all the way forward to see what I had TBB in October.  I did this with a couple categories, and tried it with a monthly goal in some too.  I ended freeing up like $600-700 for this month!

    Am I correctly understanding that if we set a spending goal and overspend, we can just roll with the punches as usual, and then the next month's goal will self-adjust to account for it?  I think I get scared that I'm going to go over and that's why I don't sweep out categories or let true expenses build up too high.  

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    • Annieland Your understanding is correct. With a goal to Spend $X by <whenever>, the suggested contributions will adjust downward every time you overspend.

      I really think this practice is the entirely opposite direction than you should be moving.

      The mere fact you overspent suggests that category is important to you. However, the goal will REDUCE funding as you move forward (by design). In spite of the fact that <whatever> is important, you force yourself to spend less and less!

      I mean, look at the basis of Rule 3. You're supposed to let money flow toward the categories that are more important at the expense of the less important things, thereby aligning your plan with your true priorities. You may think you are embracing Rule 3 because you reallocate from somewhere else, but then you immediately turn around and budget less? The net result is to undo the movement toward the higher priority and therefore worsen the alignment.

      Additionally, you only know what you know when you know it. If you choose to spend $X over the next 12 months, that's a loooong prediction window. (I have difficulty predicting discretionary things even 3 weeks ahead!) How confident are you that you guessed that total anywhere close to being in line with your priorities (that also shift around)?

      The fact you've locked that total -- selected months in advance -- effectively throws Rule 3 right out the window.

      Like
      • Annieland
      • I was told there would be no math.
      • Annieland
      • 2 yrs ago
      • Reported - view

      dakinemaui Ok, I totally get you.  The categories I chose were all relatively fixed amounts where I can't really choose my spending.  I tried it with my water bill.  We had a broken toilet that "ran" for a few days while we were out of town last year and the water bill went through the roof.  I was still budgeting based on that average but I could see that no way would I be paying that much again this year (quarterly bills).  So that's one of the ones I went back and set the goal to "see what would happen" and one bill I was underfunded $12.  Last bill comes next month so let's see if I have enough now to pay it.  I know, this raises a risk of not having enough the next time one of my kids leaves the hose running outside for 2 weeks (that was a disaster bill 4 years ago).

      Then I tried it with auto fuel.  Our gas costs went nuts last year as my son started going to a school 25 minutes away vs. 5.  But now he takes the (free) city bus home every single day.  So the average spent keeps going down and the available balance went to about twice the max monthly spend.  So that's another category I went back and used to test, and this time used a monthly spend goal.

      I do have a goal for holiday gifts because duh, that's probably the most valid use of the tool.  Can't do it for vacation because there's zero travel plans coming up :(.  Admittedly, I did put a monthly $500 for restaurants last month since I knew I underspent and just wanted to see the little change at the start of Oct.  I fully expect to totally nix this monthly spending goal.  But hey, who knows, maybe I'll actually motivate myself to stop ordering the midnight chicken wings.

      I'm sorry if I appear to be throwing bad advice out there to new or struggling budgeters.  If anyone else is reading this don't do what I'm doing.  I'm just messing around with the software because after 10 years I'm bored.  

      Like
  • OK, I completed the October rollover and this is where I landed: Got rid of all of my goals except for those related to a specific date.

    I'm using only one "Spending Goal - By Date" for Christmas spending, as a little experiment. I like the idea of limiting my Christmas spending, but I'm sobered by what dakinemaui explains about the conflict with Rule 3.  Next year I will probably go back to adding a set monthly amount to my Christmas goal and letting it build so that there is money available when I am ready to spend. That is the whole point of YNAB, no?

    The rest are "Savings Goals - Target Balance by Date," such as property tax due in December. I find these helpful for calculating my monthly contributions.

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